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1. T&C Tees is a manufacturer of T-shirts. The standard amount of 100% cotton jersey fabric used to make each T-shirt is 2.5 yards. The standard price per yard of the fabric is $2.50.During last month, T&C purchased 5,200 yards of the jersey fabric for $11,700.The production department used 5,000 yards to produce 1,800 T-shirts during the month.
Required:
a. Compute the material price and quantity variances.
b. Is the material price variance favorable or unfavorable? What might have caused this variance? Is the material quantity variance favorable or unfavorable? How might it be related to the material price variance?
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